A man and a woman managed to swim to safety soon after the fall.
Divers were sent in to rescue two boys trapped in the submerged car. Both were pulled out of the water by 6:45 p.m.
The two adults were listed in fair condition and an 8-year-old boy was in grave condition, according to Los Angeles fire officials. A 13-year-old boy was transported to Harbor-UCLA Medical Center in Torrance, where he later died.
What led up to the incident remains unknown. Witnesses said they heard screeching tires before the car plunged into the water. Investigators are working to determine if the incident was intentional or accidental.
"It went straight in the water, hit pretty hard, went out about 30 feet into the water and went straight down real quick," witness Frank Palazzolo said.
"The parents were already out screaming their kids were in the car... but nobody could do anything. The water was too deep for anybody to do nothing," witness Sal Terzoli said.
Authorities said the water in the channel is between 25 and 30 feet deep.
With grief clearly evident in his face, LAFD firefighter Miguel Meza is being hailed as a hero. Meza jumped into the waters at the Port of Los Angeles in a desperate attempt to save the two children.
"This man is a true #hero in the City of Angels and I am so proud of him!" L.A. City Councilman Joe Buscaino said in a post on Facebook Thursday night.